-USDA reports solid corn sales to China – nearly all new crop
-Argentine soybean crop estimate cut, harvest underway
-US ethanol exports strong in February
-Brazil asked to drop wheat import tariff – allow imports from Russia
-South Korea buys Brazilian corn
-Malaysia Feb palm oil stocks seen lowest since June 2017
The Buenos Aires Grain Exchange lowered their estimate of the Argentine soybean crop to 49.5 MMT from 52.0 MMT previously as a result of dry conditions earlier in the growing season. USDA is currently estimating their crop at 54.0 MMT and reflects last year’s crop at 55.3 MMT. The cuts in Argentine crop ideas are notable enough to start lending a supportive element to demand ideas for U.S. soy products in the big picture. Export sales of soybean meal and soybean oil have been quite solid of late. They left their estimate of the corn crop unchanged at 50.0 MMT, in line with the USDA’s latest estimate and compares to their estimate of last year’s crop of 50.6 MMT (USDA 51.0 MMT). The exchange put corn harvest at 22% complete, advancing 7% last week, with soybean harvest put at 8% complete.
USDA reported sale of 567k tonnes of corn to China this morning, nearly all (504k tonnes) being for new crop, 2020/21, delivery, and 63k tonnes for 2019/20.
Shipping delay concerns out of Argentina are increasing, as well, as nearly 30 vessels are said to be anchored in the Parana River awaiting health inspections of the crew before being allowed to dock.
During the session yesterday, Russia officially approved the 7 MMT grain export quota for April-June as has been widely discussed over the last week. Most do not expect this to have a notable impact on export flows as it is generally in line with overall expectations for exports during the quarter anyway. Kazakhstan will allow 200k tonnes of wheat and 70k tonnes of flour to be exported in April as they monitor/limit exports through the end of the marketing year in June.
A Brazilian wheat millers group has asked the government to lift phytosanitary restrictions on the import of Russian wheat and temporarily eliminate the 10% tariff on imports from non-Mercosur countries in order to ensure continued smooth import flows of wheat and to help reduce imported costs. Brazil imports roughly 7 MMT of wheat/year, around 60% of annual domestic needs, mostly from Argentina and, while there are no immediate threats of reduced availability of Argentine wheat, they want to be proactive given the unknowns of the coronavirus pandemic.
Yesterday’s release of official February export data by the Census Bureau revealed U.S. ethanol exports for the month were the highest since March 2018 at 194.2 million gallons and rising from 151.2 million in January and 146.5 million in December. For reference, average monthly exports in 2019 were 123 million gallons. The majority of exports went to Brazil with 56 million gallons, India 48 million and Canada 29 million.
South Korean feed mills were active overnight, buying nearly 200k tonnes of corn, all believed to be Brazilian, at prices from $184.43-$188.49/tonne c&f for July/August shipment periods.
French soft wheat conditions slipped 1% in good/excellent over the last week to 62% and compares to 84% g/e at this time last year. After a very slow start, spring barley planting was able to largely finish this week, jumping from 72% last week, as conditions dried out over the last several weeks.
The Malaysian Palm Oil Board will release their monthly report on April 10. The average estimate of end March palm oil stocks is 1.651 MMT (1.576- 1.700 MMT range of ideas), down slightly from February stocks of 1.682 MMT (2.923 MMT last year March) and would be the lowest since June 2017. March palm oil production is estimated at 1.314 MMT (1.243-1.400 MMT range) vs 1.289 MMT in February and 1.672 MMT last year March, while palm oil exports in March are estimated at 1.147 MMT (1.008-1.150 MMT range) vs 1.082 MMT in February and 1.619 MMT last year March.
Weather Over the next day or two, rains of .50-1”+ are expected for the eastern 2/3 of MN, IA and most of MO. Changes now see rains of .50-1”+ to fall in many areas east of the MS River, with MI seeing .35” or less. Sunday will bring dry weather to most of the region , with a few light and spotty showers to bring totals of .30” to around 45% of the region Monday. Most of next week looks quiet, with areas mainly south of I-80 later Friday and Saturday next week seeing .30-.80”. A cold front will bring rains of .20-.60” to the Delta today into tomorrow. The rains for Monday are no longer in the forecast and things look to be largely dry through Tuesday. The 6-10 day looks quiet through Thursday of next week and then rains of .50-1”+ to fall by later Friday into Saturday. A cold front will bring rains of .30-1” to the eastern ½ of KS, OK and TX today. Totals in the western look to be under .20”. The 6-10 day sees quiet weather to hang on through most of next week, with rains of .30-.80” to fall in most of KS and the eastern ½ of OK and TX by later Friday into Saturday. Totals in the western ½ of OK and TX look to be in the .25” range or less